We are committed to designing for, collaborating on, advocating for and investing in circularity models so the materials we use can be kept in the economy and continue to be reused. Our packaging strategy is centered on advancing the use of more sustainable packaging materials and designs that use less virgin plastic. This means incorporating more post-consumer recycled content, eliminating unnecessary materials, redesigning packaging to be compatible with recycling and composting systems and exploring reuse and refill models. Our cross-functional teams continue to work toward our established and ambitious sustainable packaging goals. As of the end of 2023, 95% of our packaging is designed to be recyclable or compostable – with a goal of 100% by 2025. Additionally, we are committed to reducing our virgin plastic use by 20% across our product packaging portfolio by 2025, achieving a 15% reduction as of the end of 2023.

Our smart design efforts aim to use less virgin plastic while also working on improved designs and delivery models that can have broader benefits and influence positive consumer recycling behaviors. Specific efforts focus on recycled plastic in beverage bottles, recycling compatibility and behaviors, material optimization and refillable packaging.

Specific to refillable packaging, we continue to advance our work by exploring new partnerships that are critical to develop and scale reuse and refillable delivery models. Examples of these efforts include:

• Working with our foodservice sales team in university campus settings as well as event arenas for potential pilots.
• Joining the Green Sports Alliance to help KDP build relationships and explore piloting reuse and refill delivery models in sports venues in the U.S. As part of our membership, KDP funded the Reuse Playbook that published in 2024. The playbook explores the current landscape in the U.S. for reusable opportunities and actions that venues and brands can take.
• Continuing to offer refillable glass bottles in Mexico where the infrastructure for collection, sanitation and refill currently exists. Specifically, our plant in Tehuacán, Mexico has over 70 years of experience in producing and managing our refillable glass bottles.

We are also working with peers in the beverage industry to establish a common methodology for the measurement of reuse and refill servings delivered.

In early 2024, we announced a new innovation aimed at meeting the needs of the next-generation of coffee consumers. The foundation of our new innovation are new K-Rounds plastic-and aluminum-free pods as well as a new Keurig brewing system, the Keurig Alta brewer. In late 2024, Keurig will offer a mail-back recycling program for K-Cup pods via Keurig.com as an option for those consumers who cannot currently recycle their coffee pods locally.

One of the central challenges to supporting a closed loop for packaging is the fragmented landscape of the U.S. recycling system. According to The Recycling Partnership, there are more than 9,000 different community recycling programs in the U.S., each of which accept different formats and types of packaging materials. The material recovery facilities (MRFs) that serve these programs often differ in the materials they choose to accept based on how modernized the facility is and the end markets the MRF can sell recycled commodities to. In addition, we know that consumers need to be educated and inspired to recycle our products, which is why we are continuing to update additional labels so that recycling instructions are visible, including extending the use of the standardized How2Recycle® symbol further across all of our K-Cup pod packages and the majority of our cold product packages. We have also adjusted our packaging to reflect the diverse nature and challenges within our country’s recycling capabilities across jurisdictions – including adding qualifiers such as “Check locally — not recycled in many communities” to our K-Cup pods.

Combining our dollars and voices in unique partnerships, we collaborate closely with a number of stakeholders – including industry groups, NGOs, investment firms and policy makers – in order to catalyze critical recycling infrastructure improvements and consumer education across North America.

KDP uses polypropylene in a wide variety of our products, from caps on our beverage bottles to our Mott’s applesauce cups. Polypropylene plastic rigid containers are now considered widely accepted in curbside recycling systems across North America, according to The Recycling Partnership’s National Recycling Database. However, many communities do not yet accept certain polypropylene containers, including coffee pods, for recycling. This is often due to outdated recycling infrastructure or lack of equipment that can effectively sort polypropylene plastic.

The Recycling Partnership estimates that polypropylene is the third-most prominent plastic in curbside recycling bins per household in the U.S. behind PET and HDPE. We believe it is critical to drive towards infrastructure and access improvements that accommodate the range of recyclable materials that are commonly used in the home. KDP co-founded and is the largest funder of The Recycling Partnership’s Polypropylene Recycling Coalition, whose goal is to increase the quantity and quality of polypropylene recovered and recycled in the U.S.

Improvements also need to be made so that commonly accepted materials — such as PET bottles and aluminum cans — can complete a circular journey every time. To boost recycling rates and create a stronger supply of quality recycled PET, KDP invested alongside its beverage peers a collective $100 million to fund the American Beverage Association’s Every Bottle Back initiative. The program aims to modernize and improve community recycling through recycling infrastructure upgrades at local MRFs throughout the U.S. and supports “recycle right” behaviors through consumer education.

In Canada, KDP co-founded the Circular Plastics Taskforce, which is dedicated to advancing the circular economy by improving plastics recycling through the deployment of optimization solutions in recycling and processing facilities. In 2023, the taskforce mobilized 20 circularity leaders from across the industry to advance the circular economy in Canada. The projects, which are valued at an estimated $600,000 CAD, are working to optimize plastics recycling. To date, the taskforce has received more than $1 million in funding from the federal and Québec governments, plus $200,000 (CAD) in private funding, supporting pilot and research projects aimed at advancing the circular economy in Canada.

KDP plays a leading role in supporting the modernization and standardization of recycling processes via EPR programs in both the U.S. and Canada. KDP is a founding member of two nonprofit producer responsibility organizations (PROs): Circular Action Alliance (CAA) in the U.S. and Circular Materials (CM) in Canada.

In the U.S., KDP played a key role in launching the country’s first PRO, CAA, and currently chairs the National Board of Directors. Several recent CAA accomplishments include:

• Colorado: selected by the Colorado Department of Public Health & Environment as the single PRO to implement Colorado’s Producer Responsibility Program for Statewide Recycling Act.
• California: selected by CalRecycle as the single PRO to implement the Plastic Pollution Prevention and Packaging Producer Responsibility Act.
• Oregon: submitted an initial program plan to the Oregon Department of Environmental Quality, a requirement to become a PRO and implement Oregon’s Plastic Pollution and Recycling Modernization Act.
• Maryland: approved to represent producer interests and serve as the single nonprofit PRO on the Producer Responsibility Advisory Council in Maryland, which will make recommendations on future proposed legislation to create a producer responsibility program for packaging materials.

In Canada, CM is at the forefront of advancing EPR operations throughout Canada and KDP Canada has supported as a founding member since 2021. Key areas of focus include:

• Emerging Packaging EPR Programs: The transition to EPR continues to progress in several provinces, with particular emphasis on operations within Ontario, where the transition to EPR began on July 1, 2023 and New Brunswick where the transition began on November 1, 2023. Preparations are also underway for transitions in Alberta, Nova Scotia and Yukon in 2025.
• Collaboration with PROs in Provinces with Established Packaging EPR Programs: Strengthening our collaborative efforts, CM’s memorandum of understanding with Éco Entreprises Québec underscores our commitment to advancing joint interests and EPR initiatives across Canada. This strategic approach highlights CM’s commitment to fostering a circular economy nationwide.